Pound to Euro Exchange Rate Forecast – The UK’s public sector borrowing figures came in better than expected

Written by on January 31st, 2012

Pound Sterling to Euro Foreign Currency Exchange Rate Forecast - The UK's public sector borrowing figures came in better than expectedIn last week’s update we asked whether the Pound can finally make a convincing break above 1.22.

Foreign Currency Market Update – GBP / EUR Update

All eyes were on the eurozone summit yesterday, which resulted in 25 of the 27 EU member states agreeing a new pact focused on tighter fiscal discipline. The idea is that everyone returns to sign the pact at the next summit in March. Both the UK and Czech Republic kept out of the deal, but tacitly endorsed the other members to make a deal outside of the EU to address the euro’s problems. There has been no discernable reaction from the Sterling/Euro rate.

Last Week

The UK’s public sector borrowing figures came in better than expected for December (£10.8bn Vs £13.4bn expected). This was overshadowed by the GDP figures for the fourth quarter which showed a 0.2% dip, double the expected contraction. On top of that the minutes of the last Bank of England meeting indicated that some members were actively seeking an extension to the asset purchasing program that we have come to know as ‘QE’. With these two data items Sterling has done well to maintain its composure.

Heads Up

* Denotes the importance of the data item *** being the highest level.

** German and Eurozone unemployment data today met market expectations at 6.7 % and 10.4% respectively.

** Wednesday, Thursday and Friday bring the release of the latest Purchasing Managers’ Index surveys for the UK’s Manufacturing, Construction and Services sectors respectively. The Services edition will be the most closely-watched.

** Eurozone consumer price index data is out on Wednesday and is expected to read 2.7%.

** Eurozone retail sales for December are expected to by 0.3% ahead on last month in figures due for release on Friday.

Outlook

In last week’s update we asked whether the Pound can finally make a convincing break above 1.22, having tried and failed over the last few years. The answer so far has been in the negative despite the Euro carrying the weight of the economic world on its shoulders, but we’re not ready to throw in the towel yet. Sterling is still managing to tread water at relatively good levels around 1.19, whereas previous failures from 1.20+ territory have been spiky affairs that result in a rapid decline.

Related posts:

  1. Sterling, US Dollar and Euro Exchange Rate: The Pound to Euro Exchange Rate has been fluctuating around the 1.200 mark this week
  2. Pound to Canadian Dollar Forecast – The GBP CAD rate has recovered from the 4-month low of 1.5545
  3. Sterling Euro US Dollar Foreign Currency Forecast – The pound gained over 0.5% against the euro yesterday on the back of higher than expected inflation data
  4. Pound Sterling to US Dollar Foreign Currency Exchange Rate Forecast – Sterling edges higher as US debt talks stall
  5. Pound Sterling to Euro Foreign Currency Exchange Rate Forecast – Sterling tests one year low…

Article source: http://feedproxy.google.com/~r/ForeignExchangeOutlook/~3/ci6PlF-Xh24/

Leave a Reply

WP Facebook Auto Publish Powered By : XYZScripts.com
Bunk Beds